Tokyo: Renault/Nissan Doing Fine, Thanks

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The Renault/Nissan alliance, which many skeptics thought would unravel, is proving to be both durable and productive.

The Japanese-French alliance has already outlasted the highly touted merger between Chrysler and Daimler-Benz, which happened back in 1998. Renault/Nissan was created less than a year later in the spring of 1999.

Thierry Moulonguet, Renault executive vice president and chief financial officer, said Monday the alliance between Renault and Nissan has proven itself to be worthwhile. The alliance partners now share suppliers — 64 percent of the top 100 suppliers at both companies now overlap — as well as two key platforms in the compact and subcompact segments that account for 34 percent of the companies’ total production.

In addition, Renault/Nissan now work closely on powertrain development and have launched a joint effort to expand their foothold in emerging markets in South America, North Africa, the Middle East, South Asia, Russia, and China. Nissan products, such as a pickup truck and the Xterra SUV, are now built in a Renault plant in Brazil.

Renault and Nissan also are integrating other partners into the alliance. Those new partners include Mahindra and Mahindra from India, and Samsung, a South Korean automaker that now exports vehicles to Russia. Nissan models are now built in a Renault plant in Brazil and in Morocco, Moulonguet said.

Moulonguet added that Renault and Nissan plan to collaborate on the development of a car that would sell for less than $3600 in new markets such as India .

"It's a huge challenge," he said. "But we believe it’s one of the key segments for the future.”

Moulonguet also said during a round-table discussion with reporters that Renault has no plans for returning to selling cars in the U.S.

"It would be very expensive," he said. "We are not contemplating that for Renault. Other markets offer Renault/Nissan better returns,” he said.

On the Renault side of the business, the new Logan, which was not supposed to be sold in Western Europe on initial plans, is doing very well in Germany and France. The Logan wagon is the only wagon available in Western Europe for less than 10,000 euros or about $14,000. The Logan, which comes in six different body styles, is becoming a true global car and total volume should reach nearly 800,000 units by the end of the decade when all the production capacity is in place, he said. However, he ruled out bringing the Logan to the U.S. with a Nissan badge.

Shiro Nakamura, Nissan's top designer, also noted the two companies have not integrated their design philosophy. Designs for both companies are developed completely independently, Nakamura said.

"We never discuss it," he said. "The platform might be the same but upper bodies are totally different.”